Trump Administration Slashes 90% Of USAID Contracts, Cuts $60 Billion In Foreign Aid

Last Updated:February 27, 2025, 07:47 IST

The cuts detailed by the administration would leave few surviving USAID projects for advocates to try to save in what are ongoing court battles with the administration.

President Donald Trump and ally Elon Musk have hit foreign aid harder and faster than almost any other target in their push to cut the size of the federal government (IMAGE: REUTERS)

The Trump administration announced Wednesday that it is cutting more than 90% of the U.S. Agency for Development’s (USAID) foreign aid contracts and slashing $60 billion in global assistance, marking a dramatic rollback of U.S. development and humanitarian aid efforts.

The newly disclosed cuts would leave only a handful of USAID projects intact, significantly reducing the scope for advocates to challenge them in ongoing legal battles.

Details of the administration’s plans were revealed in an internal memo obtained by The Associated Press and filings from a federal lawsuit on Wednesday.

These revelations highlight the scale of the administration’s withdrawal from U.S. foreign aid and development assistance, signaling a departure from decades of policy that positioned such aid as a strategic tool to stabilize economies, strengthen alliances, and advance U.S. interests abroad.

The memo said officials were “clearing significant waste stemming from decades of institutional drift." More changes are planned in how USAID and the State Department deliver foreign assistance, it said.

President Donald Trump and ally Elon Musk have hit foreign aid harder and faster than almost any other target in their push to cut the size of the federal government. Both men say USAID projects advance a liberal agenda and are a waste of money.

President Donald Trump and his ally, Elon Musk, have aggressively targeted foreign aid, cutting it more swiftly and deeply than nearly any other aspect of the federal government. Both argue that USAID programs promote a liberal agenda and squander taxpayer money.

On January 20, Trump ordered what he described as a 90-day review to assess which foreign aid programs should continue, but funding was abruptly halted, effectively cutting off all foreign assistance overnight.

The freeze has brought thousands of U.S.-funded initiatives abroad to a standstill. Meanwhile, the administration, along with Musk’s Department of Government Efficiency teams, has sidelined the majority of USAID staff through forced leave and mass firings.

In federal court filings Wednesday, nonprofits contracted by USAID reported that Trump appointees and Musk’s teams have been terminating contracts worldwide at an unprecedented pace, leaving no room for meaningful review.

"’There are MANY more terminations coming, so please gear up!’’’ a USAID official wrote staff Monday, in an email quoted by lawyers for the nonprofits in the filings.

The nonprofits, among thousands of contractors, owed billions of dollars in payment since the freeze began, called the en masse contract terminations a maneuver to get around complying with the order to lift the funding freeze temporarily.

So did a Democratic lawmaker.

“The administration is brazenly attempting to blow through Congress and the courts by announcing the completion of their sham ‘review’ of foreign aid and the immediate termination of thousands of aid programs all over the world," said Connecticut Sen. Chris Murphy, a member of the Senate Foreign Relations Committee.

The State Department said Secretary of State Marco Rubio had reviewed the terminations.

In all, the Trump administration said it will eliminate 5,800 of 6,200 multiyear USAID contract awards, for a cut of $54 billion. Another 4,100 of 9,100 State Department grants were being eliminated, for a cut of $4.4 billion.

The State Department memo, which was first reported by the Washington Free Beacon, described the administration as spurred by a federal court order that gave officials until the end of the day Wednesday to lift the Trump administration’s monthlong block on foreign aid funding.

“In response, State and USAID moved rapidly," targeting USAID and State Department foreign aid programs in vast numbers for contract terminations, the memo said.

The Trump administration asked the Supreme Court to intervene Wednesday night as an appeals court refused to lift the midnight deadline.

Trump administration officials — after repeated warnings from the federal judge in the case — also said Wednesday they were finally beginning to send out their first or any payments after more than a month with no known spending. Officials were processing a few million dollars of back payments, officials said, of billions of dollars owed to U.S. and international organizations and companies.

(With inputs from AP)

Washington D.C., United States of America (USA)

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